a Japanese telecom major NTT DoCoMo has completed all the formalities for its 26 per cent stake acquisition in Tata Teleservices Limited (TTSL) –­ India's sixth largest operator –­ for $2.7 billion. The deal values TTSL at $10.38 billion (over Rs 500 billion).

Tata Sons, the key promoter of TTSL, has stated that DoCoMo has completed its payment obligations and is preparing to acquire about 12 per cent of the common shares of Tata Teleservices (Maharashtra) Limited through an open offer.

Prior to the deal with DoCoMo, Tata Sons was the single largest shareholder in TTSL with 45 per cent stake. A consortium consisting of Tata Group companies held 21.7 per cent stake. Entrepreneur C. Sivasankaran held 8 per cent while Temasek held a little under 10 per cent stake. In the deal, Tata Communications, which had a 15 per cent stake in TTSL, sold 1 per cent stake to DoCoMo earning Rs 4.24 billion, which is about half its initial investment in TTSL (Rs 6.36 billion). Tata Power also sold a part of its holdings (undisclosed) in TTSL for Rs 3.17 billion.

TTSL's new shareholding pattern is yet to be declared. Meanwhile, DoCoMo is finalising its three nominees on the board of the unlisted TTSL.

On closing the deal, Anil Sardana, managing director, TTSL, said, "We are delighted that all transaction formalities have been completed and regulatory clearances received."

At a time when Indian operators are increasingly looking towards 3G and other value-added services, TTSL hopes to differentiate itself from other service providers by leveraging DoCoMo's expertise in the development and delivery of value-added and next-generation services.

While TTSL gives DoCoMo a foothold in the world's fastest growing telecom market, a big plus that DoCoMo brings to the table is its expertise in WCDMA technology –­ a standard that combines the best of GSM and CDMA.